Schwazze Loses $18.5 Million Despite ‘Record’ Revenue

The bottom line was about the only number for Schwazze that was down.

Denver-based Medicine Man Technologies Inc., which does business as Schwazze (OTCQX: SHWZ) (NEO: SHWZ), posted an $18.5 million loss for the full year of 2022, due to various acquisitions and its entrance into New Mexico.

The loss follows a $12.8 million profit in 2021.

The bottom line, however, was just about the only number for Schwazze that was down. The company posted solid increases in revenue, profit, retail sales, and cash flow for both the full year and for the fourth quarter:

  • Revenues increased annually 47% for the year to $159.4 million, from $108.4 million in 2021. For Q4, revenue was up 51% to $40.1 million.
  • Gross profit was up 72% to $85 million, from $49.4 million. For Q4, profit was up 89% to $23 million.
  • Retail sales were up 92% to $141.3 million, from $73.8 million. For Q4, sales were up 87% to $36.9 million.
  • Cash flow was up 35% to $11.4 million, from $8.4 million. For Q4, cash flow was up 50% to $5.4 million.

Schwazze also went on a seven-company acquisition spree in 2022, which leadership said leaves the company well-positioned for the coming year – but also with less cash on hand. At the end of 2022, it had just $38.9 million in the bank, compared with $106.4 million at the close of 2021.

As part of the acquisitions and New Mexico expansion, operating expenses shot up by 85% to $72.2 million, and the cost of goods and services increased by 26% to $74.3 million.

The expansions and acquisitions last year included:

  • 10 dispensaries, four cultivation facilities, and a manufacturing facility in New Mexico, making Schwazze a small regional multistate operator.
  • Two dispensaries in Boulder, Colorado.
  • Two indoor cannabis grows and a dispensary in Denver.
  • Two dispensaries in Glendale and Manitou Springs, Colorado.

The company also signed deals to acquire two more Colorado storefronts – one each in Fort Collins and Garden City – as of the first quarter this year, bringing its retail footprint to 45 dispensaries.

“Schwazze is well-positioned to play offense in this challenging environment,” CEO Justin Dye said in a press release. “As market forces become more favorable, we believe Schwazze will emerge with a much stronger position… For now, we will keep executing our strategy and playbook.”

John Schroyer

John Schroyer has been a reporter since 2006, initially with a focus on politics, and covered the 2012 Colorado campaign to legalize marijuana. He has written about the cannabis industry specifically since 2014, after being on hand for the first-ever legal cannabis sales on New Year’s Day that year in Denver. John has covered subsequent marijuana market launches in California and Illinois, has written about every aspect of the marijuana trade, and was part of the team that built the cannabis industry’s first-ever trade show, MJBizCon. He joined Green Market Report in 2022.

Leave a Reply

Your email address will not be published. Required fields are marked *

Get the latest cannabis news delivered right to your inbox

The Morning Rise

Unpack the industry with the daily cannabis newsletter for business leaders.

 Sign up

About Us

The Green Market Report focuses on the financial news of the rapidly growing cannabis industry. Our target approach filters out the daily noise and does a deep dive into the financial, business and economic side of the cannabis industry. Our team is cultivating the industry’s critical news into one source and providing open source insights and data analysis


Recent Tweets

Get the latest cannabis news delivered right to your inbox

The Morning Rise

Unpack the industry with the daily cannabis newsletter for business leaders.